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The December 19, 2001 Issue Provided by System Dynamics Inc.
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Heard on the Net

News about People and Companies influencing The Broadband Home


People News

Bernd Lutz has left CableLabs and is in the process of entering the M&A business with a focus on mid-cap technology companies. The CableHome project is now being led by Rouzbeh Yassini. ( www.cablelabs.com )

Robert E. Day and Larry W. Richards have been appointed to sales management at C-COR.net. Day was previously at Aurora Networks and Richards was with Philips Broadband Networks. ( www.c-cor.net )

Richard R. Hamilton has been appointed VP of worldwide sales at nCUBE Corp. He was previously at Partminer Inc. ( www.ncube.com )

Karl Savatiel has been named President and CEO of SkyBridge LP, an Alcatel company. Savatiel was previously president of Astrolink, VP at Lockheed Martin Global Telecommunications and had been with AT&T for 25 years. ( www.skybridgelp.com )

Matt Siemens has been named Executive Director of Business Development at NuVox Communications. He was previously with Maple Optical Systems. ( www.nuvox.com )

Ben Verwaayen has been named CEO of BT Group PLC. He was formerly vice chairman of Lucent Technologies. ( www.groupbt.com )

(Please email people@bb-home.com to report a change in your position.)


Company News

--Acquisitions

ARRIS is acquiring Cadant for 5.25 million shares of common stock and will assume $17 million in liabilities at the closing, as well as paying up to 2 million additional shares based upon future sales of CMTS products. ( www.arrisi.com ) ( www.cadant.com )

Lattice Semiconductor Corp. is acquiring Agere Systems' communications-chip (FPGA) business for $250 million in cash. ( www.latticesemi.com ) ( www.agere.com )

Aastra Technologies Ltd. has purchased Ericsson's cable modem business. Financial terms were not disclosed. ( www.aastra.com ) ( www.ericsson.com )

GlobeSpan and Virata Corporation stockholders have approved their merger. ( www.globespan.com ) ( www.virata.com )

Tellabs Inc. is buying Ocular Networks for $355 million. ( www.tellabs.com ) ( www.ocular.com )

Williams Communications has received approval by the U.S. Bankruptcy Court in Delaware to purchase the assets of iBEAM Broadcasting for $25 million. ( www.williamscommunications.com ) ( www.ibeam.com )

--Funding

Bergana Communications, a developer of semiconductor products for broadband-wireless applications, has secured $12 million in first round funding. ( www.bergana.com )

Digital 5, Inc. (D5) has received a $2 million investment from Texas Instruments as part of D5's $11 million second round of funding. D5's embedded systems are primarily used in digital entertainment products that sell in high volume. ( www.digital5.com ) ( www.ti.com )

Grande Communications has raised an additional $20 million in equity from new and previous investors. ( www.grandecom.com )

NexVerse Networks, Inc. has raised $15 million in private financing and acquired the ipVerse ControlSwitch product. ( www.nexverse.com )

Internet Photonics, a new company focused on optical Ethernet networks, has gotten $31 million in first round financing. ( www.internetphotonics.com )

Liberty Media Corporation has raised its stake in UnitedGlobalCom Inc., Europe's second-largest cable operator. Under a revised agreement, Liberty will own about 76 percent of UnitedGlobalCom. ( www.libertymedia.com ) ( www.unitedglobal.com )

M-TEC WIRELESS has obtained additional funding of 1.3 million Euros. The company focuses on the emerging wireless LAN market with speeds of 54Mbps and higher, using OFDM and 5GHz technology. ( www.mtecwireless.com )

Mimix Broadband, a maker of integrated circuits for broadband wireless access, has raised $7.5 million in first round funding. ( www.mimixbroadband.com )

Opthos, a provider of IP-managed, optical products for metropolitan core networks, completed a $21.6 million second round of funding. ( www.opthos.com )

Proxim has completed a $30 million private placement of shares of common stock and warrants to institutional investors. ( www.proxim.com )

SkyPilot Network Inc. secured $24.4 million in second round financing, led by Mobius Venture Capital. The company is a next-generation broadband access provider. ( www.skypilot.com )

USA Broadband, Inc., a provider of digital television and high-speed Internet services, has completed a private placement financing of just over $5.1 million.

--Other News

AT&T Broadband's saga continued this month. Earlier, AT&T received and rejected competing bids from AOL Time Warner, Comcast and Cox Communications (with Microsoft backing the non-AOL bids). Just at press time, AT&T Corp. confirmed that it will sell its Broadband unit to Comcast for $72 billion in stock and debt. The decision ends five months of negotiations and creates a huge cable operator with over 22 million subscribers. The new company will be called AT&T Comcast Corp. It will have about $19 billion in revenues and will include both companies' cable TV systems, AT&T's interest in the Time Warner Entertainment joint venture, and Comcast's interests in various entertainment businesses. AT&T Chairman C. Michael Armstrong will serve as its chairman, Comcast President Brian Roberts will be CEO. ( www.att.com ) ( www.comcast.com )

B2 (Bredbandsbolaget in Sweden) has adopted the "try it, you'll like it" approach to broadband. Since the buildings they operate in all have wired apartments, they'll send you the Ethernet card and other things you need; if you're not hooked after one month, you just send it back. ( www.bredbandsbolaget.se )

The Broadband Service Providers Association has been formed by thirteen facilities-based broadband network providers, chaired by Rodger Johnson, CEO of Knology . Other founders include WideOpenWest, ClearSource Inc., RCN Corp. and Starpower Communications. The contact is Darena Huguley darenda.huguley@knology.com. ( www.knology.com )

Cablelabs is adopting Multimedia Home Platform specs for the OpenCable Application Platform (OCAP). OpenCable is a CableLabs initiative that seeks to standardize set-tops for retail distribution. CableLabs said that North American cable operators have agreed to use "the bulk of the MHP 1.0.1 and MHP 1.1 specifications for the OCAP portion of advanced OpenCable boxes." Although the hardware portion of OpenCable specs is complete, the middleware spec is still being finalized. ( www.cablelabs.com ) ( www.opencable.com )

Cedar Point Communications, which is developing a PacketCable based telephony technology for cable system operators, announced implementation of the solution's first lab trial with Comcast Corporation. ( www.cedarpointcom.com ) ( www.comcast.com )

Cermet Inc. is the newest member in Yamacraw, Georgia's high-tech economic development initiative designed to make Georgia a world leader in the design of broadband communications systems, devices and chips. Cermet is a semiconductor focused on technologies for next-gen telecom systems. ( www.cermetinc.com ) ( www.yamacraw.com )

Covad's restructuring plan was approved by a U.S. Bankruptcy Court of Delaware judge. The company will emerge from its bankruptcy around Dec. 20. The pre-negotiated plan will eliminate about $1.4 billion in bondholder debt and pre-existing shareholders will keep nearly 80 percent of the company. ( www.covad.com )

EarthLink has announced a partnership with Circuit City to sell its broadband services throughout the US. Depending on availability in the area, EarthLink DSL, EarthLink 2-way Satellite and EarthLink Cable will be featured in Circuit City's Broadband Station kiosks, which provide information, demos and service activation. ( www.earthlink.com ) ( www.circuitcity.com )

Espial has announced availability of the Espial Suite of iTV software applications which complements established TV middleware platforms and is targeted for set-top box OEMs. ( www.espial.com )

Excite@Home's saga is coming to an end. As we wrote last month, specialized cable ISPs which were needed at the start of the industry are becoming a thing of the past as MSOs bring the capabilities in-house. Unfortunately, AT&T's customers had a far from smooth transition after Excite@Home cut off their Internet service; AT&T Broadband migrated customers to its new network over a period of a week--but not without some pain and disruption. Meanwhile Cox, Comcast, Insight, Mediacom, Midcontinent and Rogers made various deals with Excite@Home to pay for uninterrupted service for the next three months so they can implement their transitions. Excite@Home is liquidating and will shut down at the end of February. ( www.home.net )

Gemstar International lost when the U.S. FCC ruled that Time Warner Cable's analog must-carry obligations don't include Gemstar's vertical blanking interval (VBI) technology. Although FCC rules say that cable operators must retransmit program-related material in the VBI, the FCC said Gemstar's VBI material did not meet criteria for being "program-related". ( www.gemstartvguide.com )

Hughes Network Systems (HNS) announced formation of the Hughes Broadband Alliance Program with Sun Microsystems and Polycom. Sun and Polycom will develop applications and services to operate on Spaceway, Hughes' broadband satellite platform, which launches service in 2003. HNS also announced establishment of a Spaceway application center to work with HNS customers and partners to build new applications. ( www.hns.com )

NTL, Britain's largest cable operator, is expected to be taken over by its banks in the new year, leading to a likely merger with Telewest as early as the summer, according to The Observer. The company is currently struggling under debt of £12 billion. ( www.ntl.co.uk ) ( www.telewest.co.uk )

NextWeb has announced deals for providing high-speed fixed wireless Internet access to Holiday Inn Express, Ramada Limited and Quality Inns in the San Francisco Bay Area. ( www.nextweb.net )

Pace and OpenTV have partnered to integrate OpenTV’s middleware and application technology with Pace’s interactive cable home gateway, providing an integrated ITV solution for cable operators. ( www.pace.co.uk ) ( www.opentv.com )

PentaCom, a Russia Broadband Communications' subsidiary, is deploying Motorola CMTS, cable modems, VoIP residential gateways and other equipment to offer voice and data services in their 27 city network in the Moscow region. The network plans to serve approximately one million homes over the next four years. ( www.pentacom.ru/en_index.phtml ) ( www.mot.com/broadband )

Picotent has announced their Maestro service infrastructure which can be used by broadcasters to create new revenue streams from interactive television. The service is used in conjunction with an ITV platform such as Liberate and broadcasters such as Fox Sports. ( www.picotent.com )

Predictive Networks, a maker of TV "personalization" software, announced a memorandum of understanding with Microsoft TV to provide products for targeting viewers of interactive television. Predictive's technology is intended to predict what television ads and content should be directed at viewers based on their TV-watching history. ( www.predictivenetworks.com ) ( www.microsoft.com/tv ).

StarBand Communications, the two-way satellite ISP, has launched an education channel with Kaplan, Inc., a provider of educational and career services. ( www.starband.com ) ( www.kaplan.com )

Texas Instruments has introduced a cable modem reference platform consisting of TI's DOCSIS 1.1 cable modem and a 802.11b processor. The residential gateway solution will include third party software for support of a firewall, NAT, DHCP server, and web-based management. ( www.ti.com )

The UPnP Forum has created the UPnP Implementers Corp. to certify compliance with UPnP and use of its logo. They also completed the standard for Internet gateway devices. Companies with plans to support UPnP Internet gateways include: ARESCOM, D-Link, Intel, Linksys, Microsoft, NETGEAR, and Virata. ( www.upnp.org )

Verizon Wireless and Wingcast LLC are teaming to deliver a variety of voice-activated services, including emergency services, high-speed data and location-based applications to certain Ford and Nissan vehicles. ( www.verizonwireless.com ) ( www.wingcast.com )

Vivendi Universal Chairman Jean-Marie Messier, speaking at a recent NY conference, indicated the possibility of teaming Canal Plus assets with those of John Malone's Liberty Media. Liberty Media controls UPC, Europe's largest cable operator, and pending regulatory approval will become Germany's biggest cable player. Meanwhile, Vivendi announced plans to invest $1.5 billion for approximately 10 percent of EchoStar, or less than 5 percent of the combined EchoStar – Hughes following the proposed merger, which is subject to regulatory approval. Vivendi is also acquiring the entertainment assets of USA Networks. ( www.vivendi.com ) ( www.libertymedia.com ) ( www.echostar.com )

Yahoo and SBC Communications are teaming to provide high-speed Internet access to customers in SBC's 13-state region, launching in mid 2002. The service will include a suite of Yahoo! and SBC customized products and services, including many optimized for broadband. The deal gives SBC a share of Yahoo's non-subscriber revenue on advertising, e-commerce and premium features and services on the portal and gives Yahoo monthly per-subscriber payments from SBC. ( www.yahoo.com ) ( www.sbc.com )

--Broadband airplane: Good idea -- bad timing?

Several months ago we read that the age of "the broadband airplane" was on the horizon. A Wall Street Journal article included a chart comparing what US carriers are doing in first or business class to attract and retain passengers. Notable in the list is "on-demand movies" which only one US carrier in the list provided. However, Singapore already provides on-demand movies even in coach and was introducing CyberCabin, which will add Internet access and email. We were intrigued with the thought that just as many users first got hooked on broadband in the workplace and then wanted it at home, airplane video-on-demand users would soon be wanting it at home.

After the events of September 11th and the ensuing financial woes of the airlines, it looks like the effort has evaporated. Boeing's in-flight broadband service, called Connexion, suffered a potentially crippling blow on news that three major airlines -- Delta, American and United -- have decided to abandon the project. One more casualty of September 11th -- at least for now.

--Public Policy

U.S. - The Federal Communications Commission (FCC) announced a "Notice of Proposed Rulemaking" to determine what the incentives are for incumbent local exchange carriers (ILECs) to deploy broadband services in the United States. The FCC will ask about relevant product and geographic markets for broadband services; ILECs' market power in those areas; and whether ILECs' provision of service should have any restrictions. ( www.fcc.gov/Speeches/Powell/Statements/2001/stmkp144.html )

On the legislative scene, the U.S. House of Representatives postponed its decision on the controversial Tauzin-Dingell bill, putting off a vote until March.

UK - E-commerce Minister Douglas Alexander unveiled measures to speed up growth of the UK broadband market. He also published the Government’s response to the first report by the Broadband Stakeholders’ Group, established to advise the Government on the steps necessary to facilitate the rollout of broadband services across the UK. The reports are available at ( www.e-envoy.gov.uk/ecommerce/broadband/bbsgrep_menu.htm )

Also from the UK comes a report from Oftel, the UK regulatory telecom authority. It contains a benchmarking study of dial-up, DSL and cable modem Internet services in the USA, France, Germany, Sweden and the UK. ( www.oftel.gov.uk/publications/research/2001/dslb1201.htm )

In other UK news, British Telecom announced early feedback from a trial project in Cornwall on the economic problems of rolling out broadband services to rural areas. The "Act Now" project, a joint initiative between BT and several government organizations, is funded by U.K., European government sources and BT. ( www.bt.com )

Wales also has a campaign for a broadband Wales and to build a Welsh New Media. The recent Digital Matrix Cymru Broadband/Content/Convergence conference promoted a proactive broadband agenda for Wales. ( www.digitalmatrixcymru.org.uk )